Leading article: A last chance for Mr Blair to reform the welfare state

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The Government had better be ready to face a white knuckle ride when it unveils its Green Paper on welfare reform. Get ready for scenes of disabled activists chaining their wheelchairs to railings and raising the emotional temperature to boiling point. Combine that with a revolt by left-wing MPs, charging Mr Blair with attacking the most vulnerable members of society, and you have the ingredients of a first-class political storm.

It is a measure of how desperate Mr Blair must be to secure his legacy that he has even ventured down this very thorny path. Why not leave well alone? The answer to that, as the Work and Pensions Secretary, John Hutton, will say today, is that something must be done to tackle incapacity benefit in particular.

Mr Hutton will say that the founding fathers of the welfare state would be amazed to see a system designed to help those literally unable to work supporting huge numbers claiming incapacity as a result of stress. He will also say it is illogical for those on incapacity benefit to receive more than those on the jobseekers' allowance for the unemployed.

Mr Blair has talked the talk before on benefit reform without having the stomach to see it through. After he first tasked Frank Field with drawing up a shake-up, he abandoned him under pressure from Gordon Brown, who fought off Mr Field's call for a shift away from a means-tested approach to benefits.

The question now is whether the Prime Minister has the clout to see through a divisive reform when the rebels in his party are emboldened by the knowledge that he is on the way out. The signs are that he might, not least because the sheer cost of incapacity benefit has reached the point where it demands action.

The rise of incapacity benefit to becoming - at £12bn annually - one of the biggest single burdens on the welfare state dates back to the Thatcher era. Then, the Government, in a desperate attempt to massage down unemployment figures, encouraged GPs to sign off clients as recipients of incapacity benefit instead.

At first this was not controversial, for most recipients were middle-aged or elderly northern male victims of the mass closure of mines and factories. But the profile of recipients has changed. The number has steadily risen to 2.7 million and has altered as more claimants cite stress and mental health problems rather than physical disability. Now these latter make up one third of the total. There are also more claimants today in the wealthy South-east than in the poorer North.

If anything is amiss with the Green Paper, it is that the planned changes are too timid. The reform aims to ensure that new claimants for incapacity do not, as now, automatically get a higher allowance than the ordinary unemployed. There are to be more checks on recipients' conditions and more nuanced assessments of ability, which means that if claimants can work in any form, they will face the prospect of being retrained.

The reforms will only affect claimants applying once the legislation has gone through, in 2007-8. Clearly the Government did not want to add to the fury of disability rights groups by cutting existing claimants' payments. But the concession opens up the vista of a two-tier system in which new claimants resentfully eye the superior allowances of the older ones.

The existing system cannot stand. With the Chancellor apparently on board, and the Tories forswearing their old opportunistic policy of opposing the Government for the sake of it, there is no reason why Mr Blair should not to ride out the fury that will inevitably meet the proposals.